Leading Musicians Protest Against Pandora Royalties

Five of the world's most successful songwriters performed on Capitol Hill to protest against Pandora and the Internet Radio Fairness Act (IRFA) last Wednesday.
Pandora, which had 60 million listeners over the last month, wants to reduce the revenue it pays musicians and claims it will help them maintain their business, according to Rolling Stone.
Linda Perry, who wrote Christina Aguilera's "Beautiful", said from the stage: "Pandora wants to make money more money - off the thing we created."
The IRFA bill pits Pandora against the music business. On one side, Pandora says it is "barely hanging on", but the musicians say they deserve a fairer share of the royalties and that Pandora should re-work its business model if it can't sustain itself.
7% of US radio listening is done on Pandora, and it has paid artists $250 million so far this year. That's more than half its revenue, compared to the 7.5% that satellite radio stations pay and 15% that cable TV music channels pay.
"This is real money flowing to the artists, and we love that it's meaningful. I believe, if totally unfettered, Internet radio would totally replace FM," said Pandora's Joseph Kennedy/ "There's truly a win for everyone for artists, for innovators who develop great digital services and for the listening public if we can get this right."
But the five songwriters who performed in the live protest said their songs had been streamed on Pandora 33 million times between January and March this year, and were paid only $600.
It's a tough call - musicians are losing out on traditional sales and need new forms of revenue. But if Pandora is being truthful, it could collapse under the costs of supporting the complex infrastructure that enables internet radio.
Who would you side with? Let us know in the comments.

That's true, what's probably happening is that the people who sang the songs are getting a cut as well as the songwriters, so the songwriters are getting 6.5% of the royalties (i'm just estimating here) and they feel ripped-off because other artists who don't employ songwriters are getting paid a higher percentage of royalties.
Personally, what I don't understand, is that according to the article Pandora makes around 250 million dollars a year (after paying musicians they're deserved royalties) and they're claiming that they need more money to stay in business. Why is it that my father, who runs a small business and has to pay for a wide variety of materials on a daily basis, can keep his business going with less than $80 000 a year while this internet company is claiming that it cannot sustain itself with an average of a million dollars being made on a daily basis.

Well I know that a record company pays out a higher total if there is a songwriter and a performer than they do if the sing/performer writes the song. I can't remember numbers, but it was like 10% for the singer/songwriter if they're the same person, and 6% to the singer and 7% to the songwriter. Once again those are only examples not actual number.

That's true, of course we're talking about a radio company and not a record label.
Of course, every album/song sold is divided up between a large amount of people. The people who created the music on the album, the people who are selling the album, the people who packaged the album, and the people who created anything that was used on the album with their permission (sound samples, album artwork). It's pretty amazing how much work goes into making an album that people take for granted.

Did you randomly compare your dad's small business that may or may not have anything in common with Pandora aside from being a business? lol
If you mean to say "why does an internet company need so much money to operate, because the internet should be cheap right?" well I'm not sure. My guess is Pandora is doing fine (for now) but may be unable to expand and are soon to be competing more directly against Microsoft and Apple among their current rivals.

I guess Linda Perry isn't that big as a musician (although What's Up was a massive hit worldwide, especially in Europe), but as a songwriter she's written pretty damn successful songs for Christina Aguilera, Pink, Gwen Stefani, Alicia Keys and Celine Dion. Whether any of those artists are to one's taste or not, their success is just a fact.

Just highlights how stupid the music industry is though, the "artists" you've listed are just instruments. We need some proper ****ing bands to get some airtime, or at least some pop singers who actually care enough to write their own lyrics.

We can agree the music industry is stupid. You gotta realize though, if you're talking music "industry", and by that i mean recorded melody's as a product, thats the way it always has been and most likely always will be. Elvis is the king of rock and roll. I can't think of one hit he wrote himself. (please enlighten me if you can, i honesstly don't know a popular one though). But yea, the music industry is stupid

Not always, a good portion of songwriters nowadays use pre-manufactured loops to create music. Some songwriters are completely incapable of playing an instrument, but since they have great knowledge of music theory, they create sheet music for musicians to play.
Joe Meek, in my opinion one of the greatest songwriters/producers of all time had not music knowledge at all. He would compose his songs by simpling whistling melodies to the musicians, and letting them figure out how to translate his whistled melodies into music.

@Ghost, I don't really want to get into semantics here, but I will say that your reply (Some songwriters are a completely incapable of playing an instrument/They create sheet music for musicians to play) contradicted itself, which ended up being agreeable with me.
Songwriters create something into existence. Musicians play that something which exists. Totally different.
(Excuse me if I repeated myself and this reply ends up somewhere else. My first post disappeared and had to retype.)

I'd side with the musicians, being a musician, but let's be real, the music industry is at the bottom, and lots of businesses are being made ontop of music to exploit it, just like factories exploiting workers to get their work done to make money. Unless enough of us push against them, they'll win every time.

That's true, but with that sort of attitude you sell yourself short of cash. It's like when people say they are all about the music, they are phonies because they'd never sign a contract that says they will never make any money but still play huge stadiums.

That's a good point. But then again you could look at is as you can't afford to have music as a career and not make money off it. The only way to get to playing stadiums as a musician is to make money off your music, because if you don't make the money to survive then your music would have to take a backseat while you work a job that brings in some cash.

Musicians have the short end of the money stick these days because of the Internet. Many people pirate their music, and the music used to be the bulk of revenue. Royalties are all they have left when licensing to radio and other mediums. Sure, a band can go out on the road and sell a bunch of t-shirts, but remember that these have their own costly expenses.
Take away the royalty and music is hardly a viable revenue.
If Pandora cannot survive on what they're paying now, they need to rethink their business model. That's just how it is. Pandora can up their advertising revenue, become subscription-based, whatever. As of right now, I hope IRFA doesn't pass.

When a corporations' business model is outdated and failing, they change it or die. Why is the government debating a bill (IRFA) to help this private corporation? Will this bill apply to all internet radio businesses or just Pandora? And who exactly were the 5 songwriters who protested?

Is it really fair that Pandora has to pay so much more than television or sattelite radio? Why aren't they protesting those mediums and demanding higher royalties from them?
I'm with Pandora on this one.

Remember that television and satellite radio is advertising/subscription based. That's probably the road streaming is going down.
I'm gonna re-quote myself:
If Pandora cannot survive on what they're paying now, they need to rethink their business model. That's just how it is. Pandora can up their advertising revenue, become subscription-based, whatever. As of right now, I hope IRFA doesn't pass.

Well first of all, I don't want internet radio to replace FM. I love my local stations. They're a part of our community, and they still do play good music. I love Pandora, and I think it's a great way to discover new music, but if supporting it means killing FM radio, then forget it.

well songwriters got paid 600 is better than shuttin pandora down and get nothing..... it is for three months..... but you still have to pay artist, producers, record company.....
i dont know what to think but it really is all about accounting books....

I'm siding with Pandora on this one. If they can't afford it, those artists won't even get their $600 much longer. With that said, Pandora really needs to change their business model if they're struggling this much. They have a pretty significant amount of listeners, they need to learn how to profit off that better. I wonder how Spotify is doing. From what I hear, artists make about .4 cents per listen, so that's not very much either.

"Linda Perry, who wrote Christina Aguilera's "Beautiful", said from the stage: 'Pandora wants to make money more money - off the thing we created.'"
Therein lies one of the biggest problems with music today. "Artists" can even write their own damn music these days. It's incredibly pathetic. I don't really care if Christina Aguilera makes less money from Pandora.

Fair enough if Christina Aguilera makes less money than she might from Pandora, but the real victim here would be Linda Perry. The bulk of the money goes towards the songwriters, so it's them who lose out, not necessarily the performers. That's the issue with this. Regardless of who performs the song, it's the person who put the time and effort into writing it who's losing out.

Maybe I'm missing something, but couldn't the songwriters state something in their contract about getting a greater percentage from airplay (pandora, radio etc) than what they're getting now? If she's as good as everybody says she is, I'm sure whatever record company hires her would be willing to shell out a little bit more.

These people are greedy idiots. They don't even realize the exposure they receive from services like Pandora creates even more revenue for them in the long run. And it's not like Pandora distributes songs for freethe songs are played randomly with ads in between, at a shitty 128KBps bitrate.

It is true that the songwriters deserve more for what they made.
However it is also true that Pandora will go out of business if they shell any more money out for them.
Maybe this is a sign that internet radio isn't the way to go.

That's not a problem that has anything to do with 'today'. It's been a regular practice since the 1950s. Hell, playing original music as a band or singer/songwriter is still a concept younger than having outside songwriters.
I don't care at all for Christina Aguilera or her music, but there are plenty of talented singers who didn't write any of their own music, and that's not the function they serve anyways.

My thoughts, for the people who are interested in reading comments -
Pandora is paying more than half of it's revenue to artists? SCREW THAT. Some artists are getting paid really small amounts? SCREW THAT. What you do, is you tell the big name artists "we're not going to pay for you as much. If you don't like it, leave". Support smaller artists, support REAL songwriters, and stop paying the fat cats more money. As a musician who sees 600 dollars as a crap load of money, I can't necessarily empathize with the people who are whining about Pandora's changes... but if they wrote songs, at least give them more credit than the pop stars who did nothing but show up in the studio and sang some retarded lyrics over it.

While this is great for smaller artist, know that most of pandoras listeners are not musicians in the first place. Taking away all the artist that their majority of listeners like and listen too will really ruin them in the end.

Typical bullshit, blaming the people who do all the real work while hoarding away all the money in offshore accounts. When is the real talent in the music industry gonna finally rise up and take what is rightfully theirs?

I think people forget not every musician/songwriter/whatever is rolling in cash.
If an article about some unknown band protesting was on here, nobody would care and those who do would probably say things along the lines of "They shouldn't be in it for the money"
If an obviously wealthy band does the same thing comments such as "do they not have enough money already? Shut up *band*" fly around.
In short, considering this is a site primarily filled with people who call themselves 'musicians', there is a lot of douchebaggery when it comes to other musicians making any cash if it means it isn't free (or at least dirt cheap) to listen to their music.
Then again, I guess that the average age of the users here is around 12 so I can't really expect any of them to understand why they should pay for things, or even what the value of the 10 allowance from their parents is really worth.

I think YOU forget that not every musician/songwriter/whatever has talent and deserves the money given to them.
99% of the damn charts are filled with talentless hacks who have all their songs written for them, play no part in the producing of the music, and some even lipsynch their damn live shows. THAT's why you hear comments of "do they not have enough money already? Shut up *shitty pop singer*"... But I was more talking down on Pandora. As stated in a comment above somewhere, they make 250 million dollars AFTER paying royalties...
Also I am 18 years old. I have a job and attend school and buy my music like an honest person should.

Its a business. Like it or hate it. Do you criticize the grocery store for not growing the tomatoes them self? No, You do not. Same logic here. A artist like it or not, if you want to make a living doing music is a business, and has to be treated as such. If the songwriter them self preformed the song they wrote, would it be as effective? maybe, most likely not. Just like in any other business in the world, everyone has their job and position.

Cause you know. They don't make ANY money off of merch, concerts, itunes, spotify, and physical copies or anything. And even if they didn't, who goes into to the music buisness expecting to be rich? Half of them are homeless when they first start out. And Pandora provides a quick way for new people to find your music AND gives you a link so you can purchase it on itunes and may lead them to buying MORE from you. It's main function isn't to give musicians a major source of income, it's to get them discovered which, financially and carreer-wise, pays off in the long run.

I find it weird that they mention the number of people listening as being even related to how much money they receive. If 15 million people or 500 million people listen, they still did the same amount of work.

If radio and TV make most of their money off of ad revenue, then maybe Pandora should look into, y'know, more ad revenue.
Radio, specifically, subsists almost entirely on advertisers and promotions. The more people listening to that station, the more the ad time is worth...
60 million users has to be worth a lot in advertising. Tack small ads onto things, make a premium ad-free service, and start rolling in the cash.

I think Linda Perry and other musicians and songwriters taking issue with pandora should probably talk to the record company first. . . also, in Perry' case, she should probably be talking to Aguilera as well.
In this whole music industry debate we seem to forget that record companies, yes while putting in large investment in musicians, but then they yield a large payback, but still pay the artists dick in return. . . maybe I'm picking the wrong bone for this article, but record companies should probably be doing a better job of paying musicians.
Also, has anyone else notice that UG is actively trying to start fights with such lines as, "which side are you on?"

The way I see it, most of the Pandora stations I listen to on a regular basis are full of small time artists that, without Pandora, I would have NEVER heard of and never fallen in love with. This then leads me to checking out the artist and most likely buying or sharing their material so that more people can be exposed to it. This isn't true for EVERY artist on Pandora, but I feel that it does indirectly help several artists striving to be heard.

Fucking morons. Pandora wasn't designed for profit for musicians or the company. Last quarter they lost 25 mil. Their only goal is growth. Then they sell. It makes a few people lots of money. Paying musicians more would be stupid since the company isn't built to last.

News flash for Linda Perry & Co.. The IRFA has absolutely nothing to do whatsoever with how songwriters are compensated.
This bill deals with how rates are set for the sound recording owner and the PERFORMING artist. i.e. Christina Aguilera.
So, let's re-calculate what pawdry sum Pandora paid out to the performers of those 33M plays/listens. That would be $36,300 in just 3 months.
This is $36,300 is split roughly 50/50. Half goes to the copyright holders (typically the label) and the other half goes directly to the featured performing artists. If the performing artist owns the copyright they take it all--less a 5% cut divided among session players & vocalists.
Since they don't mention how many different recordings were streamed 33M times, no way to accurately determine individual shares--but more than likely it's a far far cry from the $600 they received from ASCAP, SESAC, & BMI.